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business and other expense deductions claimed). Sec. 6662(a) and
(b)(1).
Negligence may be indicated by the failure to make a
reasonable attempt to comply with the Internal Revenue Code
provisions and supporting regulations, to exercise ordinary and
reasonable care in preparing a tax return, to keep adequate books
and records, or to properly substantiate items. Sec. 1.6662-3(b)
and (c), Income Tax Regs. Negligence also may be indicated by
the failure to do what a reasonable and ordinarily prudent person
would do under the circumstances. Neely v. Commissioner, 85 T.C.
934, 947 (1985).
The accuracy-related penalties do not apply to any portion
of underpayments for which there was reasonable cause and with
respect to which taxpayers acted in good faith. Sec. 6664(c);
sec. 1.6664-4(a), Income Tax Regs. Taxpayers generally have the
burden of showing that they were not negligent. Rule 142(a);
Bixby v. Commissioner, 58 T.C. 757, 791-792 (1972).
Petitioner argues, with regard to the accuracy-related
penalties for 1991 and 1992, that his bankruptcy and his divorce
made it difficult for him to maintain adequate records regarding
his claimed business expenses and establish reasonable cause for
the errors on his income tax returns.
With respect to the accuracy-related penalties for 1991 and
1992, petitioner offers no credible evidence with regard to the
disallowed investment interest expense item for 1991, the
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